A number of blockchain startups are struggling to provide a credible use case for blockchain tech and fund their crypto projects as cryptocurrency prices have taken a deep nosedive, as reported by CNBC on Feb. 11.

Crypto startups are closing shop, and their talented employees have gone on to become free agents.

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This works in favor of big tech companies such as Facebook as they can snatch the “free agents” for their own projects.

Facebook Confirms Hiring Chainspace Employees

However, the social media giant confirmed to CNBC that it had hired the startup’s employees but did not buy the company or any of its technology.

Chainspace is a blockchain firm established by Ph.D. researchers from University College London.

LinkedIn records reveal that two of the startup’s founders are now listed as employees of Facebook. Chainspace says it wants to give people ownership of their personal data.

Zachary Schwartzman, an RBC internet analyst, sent a note to clients in which he highlighted that blockchain poses a threat to major tech companies such as Facebook.

Schwartzman said that Facebook’s position on Chainspace could be categorized as an “acqui-hire,” a term widely used in Silicon Valley to refer to a company that acquires another company with the aim of hiring its employees.

In April last year, crypto unicorn Coinbase paid slightly more than $100 million to acquire Earn.com in a move considered by many as an opportunity for the cryptocurrency exchange to snatch Balaji Srinivasan and appoint him CTO.

Satya Bajpai, head of Blockchain and Digital Assets Investment Banking at JMP Securities said that “acqui-hiring” affords tech companies the opportunity to onboard a team of blockchain experts already working together towards a common goal.

Bajpai further added that there would be more deals and partnership as the crypto industry matures and evolves.

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Williams is a fintech journalist with a passion for blockchain technology and its revolutionary applications in finance. He also has a special interest in global politics and economics.

After studying Chemical Engineering, he became a freelance journalist and research analyst and has never looked back. He has written content for several blockchain firms and his work has been published on many crypto news publications.